John Energy IPO is on track despite ONGC probe

Vol 21, PW 20 (12 Jul 18) People & Policy

Despite allegations of 'forgery and cheating' John Energy says it is firmly on track to launch on the stock market by September (2018).

"Work is progressing and the IPO (Initial Public Offering) is on track," says a John source, refusing to divulge more. Sources close to IPO process believe the launch, which has been talked about for nearly 10 years, will happen within the next two months.

He points out that John filed a Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) on February 15, 2018. "At the moment," he says, "we are preparing the formal RHP (Red Herring Prospectus).

It will be sent to SEBI for approval, after which a prospectus will be prepared, followed by the launch of the IPO." Details of the share price, he adds, will be included in the RHP.

John's promoters, the Vyas family, want to sell 25% of their 50.23% in the company to raise Rs164cr ($27m) on the NSE and BSE to repay debts. An analyst says by September 2017 John had a long-term debt exposure of Rs306cr ($44m) and short-term debt exposure of Rs154cr ($22m).

It was also required to immediately repay Rs110cr ($16m) of long-term debt maturing in September 2017. "The total debt on the balance sheet as of September 2017 is Rs571cr ($83m)," he explains.

"John has Rs44.54cr ($6.5m) cash in hand. So net debt is Rs526.46cr ($76m)."

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